Abstract

Although businessmen contemplating the sale of a going business or of an interest therein—especially where any sizeable sum is involved—are unlikely, today, to get very far into the planning of such a transaction without expert tax assistance, it is probable that sales of businesses or of business interests of modest size sometimes occur in which the businessman's only counsel in the transaction is that of an attorney engaged in general practice who makes no claim to being a "tax specialist."

The purpose of this article, therefore, is to present the principal income tax considerations involved in the sale of a business or of an interest therein, in the hope that it may be of assistance to the attorney engaged in general practice who may be retained to assist a business client in such a transaction, by alerting him to the income tax consequences of such transactions, and some of the tax pitfalls lurking therein.

Space limitations necessarily make impossible "in depth" treatment of the subject matter. The reader is, accordingly, cautioned that, in transactions of the types to be discussed (as in numerous others), the client is frequently best served by his attorney's recommending retention of reputable and experienced tax counsel to assist the attorney in the planning and consummation of the contemplated transaction.

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